Real Estate Closing in New Jersey

Buying or selling a home is the largest financial matter most people will ever be involved in. In the best of circumstances, it can be a cooperative and straightforward arrangement between a buyer and seller. However, there are many different complications that can arise and make matters difficult, which is why it is very important to hire an experienced lawyer for a real estate closing. Contact Himelman & Himelman today with any questions, or to get started on the path to owning a home.

The New Jersey Real Estate Closing Process

The NJ real estate closing process breaks down into four major parts: the attorney review, inspections, the mortgage process, and finally the actual closing.

The Attorney Review

1. The attorney review process begins when an offer on the home is agreed upon by both parties and a contract is signed. This begins a 72-hour attorney review period. During the attorney review period, changes to the contract can be made (if agreed upon by both parties), and either party can walk away from the deal without penalty.

2. The buyer pays a ‘good faith deposit’ to the seller’s attorney or broker (not directly to the seller) upon signing the contract. This amount usually ranges from $1,000 to $5,000. The buyer pays the rest of the deposit (sometimes called earnest money) according to the time frame agreed upon in the contract, usually within a few days of the signing.

3. The buyer requests inspections they would like to be performed, according to the contract. These inspections must be completed by an agreed-upon date and can include:

Smoke detector certification. This confirms that the appropriate number of smoke detectors are present and in proper working condition.

5. After these inspections, the buyer can ask the seller for repair work or a reduced sale price if necessary. In response, the seller can agree to or refuse the buyer’s requests, or continue to negotiate. If an agreement cannot be reached, the buyer can walk away from the deal and, in most cases, get back their earnest money deposit.

The Mortgage Process

The mortgage process can happen at the same time as the attorney review, and should be started as early as possible. It is recommended not to change your employment or do anything else that might affect your financial status during this process, as it can complicate matters.

1. The buyer submits a loan application to their lender (for example Fannie Mae), directly or through a mortgage rep.

2. The buyer sends personal financial disclosures to the lender, which can include:

Statements for all of the buyer’s bank and investment accounts.

Statements for any loans or rent payments the buyer currently has.

Two years of tax returns, made available to the lender via this tax form.

Contact information for the buyer’s employer, as well as pay statements.

Any information regarding child support, alimony, cash gifts, or any other financial considerations other than the buyer’s income. This information must be current and accurate so there are no surprises later.

3. The lender decides whether to approve the loan. If they do, they will send a loan commitment letter to the buyer agreeing to fund the mortgage so long as their terms are met.

4. The lender orders an appraisal of the property to ensure that the buyer is paying what the property is worth. If the appraisal finds that the property is worth much less than the buyer is paying, the lender can decline to fund the mortgage unless the price changes.

The Real Estate Closing

After the previous two processes are complete, they actual closing itself takes place. The real estate closing typically takes place in one meeting, where the buyer and seller sign all documents related to the sale and the buyer pays the balance of the purchase price. At this time, the buyer usually receives the keys unless otherwise agreed upon.

1. A title search is run prior to the closing, ensuring that there are no problems with the property that may affect it’s value, and to confirm the seller owns it and has the right to sell it.

2. A final walkthrough of the property is conducted right before the closing, to make sure nothing has changed since the process began.

Contact Us

A real estate closing can seem complicated and overwhelming at the outset. At Himelman & Himelman, we know the ins and outs of this process and can help you become an NJ homeowner. Contact us today to get started.

Speak to an Attorney Today

The Lawyers of Himelman & Himelman Law Firm have been serving Red Bank NJ and the surrounding communities of Monmouth and Ocean County for more than 50 years. Our attorneys bring years of knowledge and experience to issues regarding or related to Real Estate Closing in New Jersey. Contact us online or call us direct at 732-842-8200 to speak with a legal professional today.

Red Bank Office

Free Case Evaluations

We have been providing sound legal counsel to Red Bank and the surrounding areas of Monmouth and Ocean County New Jersey for more than 5 decades. If you are facing issues regarding divorce, family law, business law or estate planning contact us today, we offer FREE case evaluations.

The use of this website does not constitute a client attorney relationship. Any information contained on this website is solely for marketing purposes and does not constitute legal advice.

The outcome of any legal matter can vary based on a variety of factors, therefore we cannot guarantee any results. Please do not use this website to send any confidential or time sensitive personal or legal information.